The Supreme Court Just Dealt Argentina A Big Blow In Its Case Against Hedge Fund Managershttp://www.businessinsider.com/supreme-court-wont-hear-argentina-case-2013-10/comments
en-usWed, 31 Dec 1969 19:00:00 -0500Fri, 09 Dec 2016 10:28:43 -0500Linette Lopezhttp://www.businessinsider.com/c/52531eeaeab8eac64c46cbffkrypticMon, 07 Oct 2013 16:51:54 -0400http://www.businessinsider.com/c/52531eeaeab8eac64c46cbff
The Hedgies bought the debt at pennies on the dollar. Don't cry for them.http://www.businessinsider.com/c/5252f9c56bb3f7ea1efdcbb4john1066Mon, 07 Oct 2013 14:13:25 -0400http://www.businessinsider.com/c/5252f9c56bb3f7ea1efdcbb4
So in your world all loaned money is risk free to the person loaning the money. All risk is to be put on the people borrowing the money.
So you really want a world of mostly serfs.
And all so you can worship your god, money.http://www.businessinsider.com/c/5252ee72eab8eabe6646cc00InvestorMon, 07 Oct 2013 13:25:06 -0400http://www.businessinsider.com/c/5252ee72eab8eabe6646cc00
PS - what Argentina should have done is as soon as the problem with the Indenture was identified, they should have paid bondholders something to amend the 100% consent requirement down to 66 2/3rds. This could have been done for a nominal payment to the original bondholders most likely and when the country hit hard times and needed to restructure, they would have had the leverage to do so.
Sadly, whoever was in charge of Argentina at the time likely didn't want to pay the 1 to 2 points on the bonds to get the Amendment approved and with the value of foresight, that has turned out to be a disasterous decision.
Again, this all could have been solved very simply had Argentina been a bit more intelligent when issuing the bonds in the first place.
My gut - they were probably told they could qualify for a minor yield break, say 25 to 50 basis points for including a 100% consent requirement. This looked appealing at the time because a restructuring wasn't something viewed as likely. In hindsight, the 50 bps savings was an utterly stupid thing to exchange for such onerous amendment requirements in the bond Indenture (but we see companies and sovereign's do this all the time).http://www.businessinsider.com/c/5252ee51ecad043b014e65cbMudhenMon, 07 Oct 2013 13:24:33 -0400http://www.businessinsider.com/c/5252ee51ecad043b014e65cb
Argentina borrowed the money. They should pay it back. How difficult is it for you to understand that concept? Anything less than a full repayment would constitute theft. Theft is wrong, whether it is from the poor or the rich.
Maybe you should give me a loan... I "Argentine" promise to pay it back...http://www.businessinsider.com/c/5252ed7369bedd6f4646cc07InvestorMon, 07 Oct 2013 13:20:51 -0400http://www.businessinsider.com/c/5252ed7369bedd6f4646cc07
No John, the only person talking about sovereignty is Argentina's president, well and you.
Argentina chose to borrow the money at issue in this claim, it was forced upon them. Argentina signed the bond indenture of this claim, it wasn't forced on them.
No one can force a country into a depression. You're a lunatic if you think that's the case.
The problem here is when Argentina restructured their bonds the first time, they didn't handle it according to international norms and that's no one's fault but their own. In a restructuring of this type, the bond indenture governs and states what percentage of bond holders is required to amend the indenture. In this case, Argentina's attorney's and investment bankers screwed up royally and inssued bonds that required 100% consent to amend. Most require 66 2/3rds or 50%.
And in a typical restructuring, non consenting bondholders who don't tender their bonds end up with bonds stripped of all covenants and rights. For this reason, if a restructuring is going to occur, everyone consents because to not do so would leave you with a worthless asset.
In this case, the bonds held by the parties in question weren't stripped because the amendment to the indenture required 100% consent. So the original indenture was never amended. The bondholders that exchanged their bonds for new bonds did so out of nothing more than their own goodwill. That isn't how the capital markets typically work and restructurings occur all the time, both in the sovereign debt market as well as the corporate and municipal markets.
Bottom line, Argentina screwed up royally. They have no one to blame but themselves for the mess they are in.
The bondholders are simply fighting for the rights under the bond indenture that was executed by Argentina and still stands as a binding legal contract.
Seems in your world, binding legal contracts mean nothing. And if that's the case, you can kiss borrowing money goodbye, not only for sovereign countries for for corporates, individuals, you name it. Can't imagine you think that's the case.http://www.businessinsider.com/c/5252e3476bb3f7f172fdcbb3john1066Mon, 07 Oct 2013 12:37:27 -0400http://www.businessinsider.com/c/5252e3476bb3f7f172fdcbb3
So what you're saying is a countries sovereignty only goes as far as international money lending.
So why do the very rich get this power? 90% of all stocks, bonds etc are owned by the top 10% of US wealth holders so odds are very good those bonds where bought by them. They can now use this power to force a country into a depression if they want. Screw the people of that country. The rich have to have as little risk as possible.
All the risk must be put on the people of that country.
Now did you know that folks do not like that and they get sick and tried of all the risk being put on people who have very little by folks who have so much more?
Do they just take that?
Economics can always end at political unrest and rulings like this push it in that direction.http://www.businessinsider.com/c/5252df2becad045d634e65cbAhjayMon, 07 Oct 2013 12:19:55 -0400http://www.businessinsider.com/c/5252df2becad045d634e65cb
That what Hedge Funds take risk for ... when they make high risk investments for high yield...http://www.businessinsider.com/c/5252dea2eab8ea4a4746cc16katmandoo122Mon, 07 Oct 2013 12:17:38 -0400http://www.businessinsider.com/c/5252dea2eab8ea4a4746cc16
You know, both sides are right (or wrong, depending on how you see it). The bond holders are vultures. But Argentina got there on their own. It's like complaining about the loan shark threatening you...you made your own bed.http://www.businessinsider.com/c/5252d98eeab8ea503b46cc06HyperloopingMon, 07 Oct 2013 11:55:58 -0400http://www.businessinsider.com/c/5252d98eeab8ea503b46cc06
F...$#@@ bitch it takes the money and now dont want to play